(Bloomberg) – Apple Chief Executive Tim Cook is wrapping up his biggest tour of Southeast Asia in years as he looks for new growth markets and manufacturing locations to offset headwinds in China. Meet with Singapore’s leaders.
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Cook is scheduled to visit Singapore on Thursday and Friday to meet with Lawrence Wong, who is set to become prime minister next month, and his predecessor Lee Hsien Loong, according to people familiar with the matter. It turned out that the executive’s itinerary was not made public.
Apple’s CEO is nearing the end of a highly public tour from Hanoi to Jakarta, during which he reiterated the region’s importance as both a market and an emerging manufacturing hub. His company is seeking growth markets beyond its traditional stronghold of China, where demand for its flagship product, the iPhone, has slumped. The company is also diversifying production outside communist countries to reduce risks amid rising tensions between the world’s two superpowers.
People familiar with the matter said Mr. Cook’s schedule is dominated by public relations efforts aimed at increasing interest in the brand, from meetings with the leaders of Vietnam and Indonesia to interactions with local customers. Apple has already increased its retail presence and production in countries such as India, and is now looking to better tap into the relatively fast-growing Southeast Asian market, which has more than 650 million consumers. .
The trip could pave the way for more aggressive sales campaigns in densely populated areas where Android phones from Samsung Electronics, Xiaomi and Oppo dominate the market, one of the people said. That’s what it means.
As part of that push, the company is close to opening Malaysia’s first Apple Store in a luxury shopping complex in Kuala Lumpur. Apple currently operates five physical stores in Southeast Asia, three in Singapore and two in Thailand, according to the company’s website.
Singapore’s plans are subject to change, and Apple has not made public Mr. Cook’s schedule in the region. Representatives for Apple, Singapore’s Ministry of Finance and the Prime Minister’s Office did not respond to requests for comment.
Apple, which has operated in Singapore for more than 40 years, announced on Wednesday that it plans to invest $250 million to expand its campus in the city-state. The company employs more than 3,600 people there and said the expansion will provide space for new roles in artificial intelligence and other functions.
“Singapore is a truly unique place, and I’m proud of the connections we’ve made with this dynamic community of creators, learners, and dreamers,” Cook said in a statement on Apple’s website. “As our campus grows, Apple is writing a new chapter in our history here.”
Cook met Vietnamese Prime Minister Pham Minh Trinh on the first leg of his visit on Tuesday, after pledging new investment in the country. He said Apple plans to buy more parts and accessories for its devices from Vietnamese suppliers, a major boost for the country as it emerges as a global electronics hub.
Cook told Indonesian President Joko Widodo on Wednesday that Apple is considering the possibility of manufacturing some devices in Indonesia. The two also discussed Indonesia’s controversial new trade rules to produce more goods domestically, one of the people said.
In the most significant policy move from Cook’s visit, the Indonesian government announced Thursday that it will consider incentives to attract further investment from Apple. Those could include tax cuts, Coordinating Maritime and Investment Minister Luhut Pandjaitan said in a video statement, adding that the country could emulate India and Thailand in taking such steps.
Southeast Asia has become an increasingly important market for Apple due to weak demand in China. The Cupertino, California-based company has struggled to maintain domestic sales since the debut of its latest iPhone 15 series, resulting in a 10% drop in shipments in the first quarter. The Chinese government’s ban on iPhone use in government agencies and state-owned enterprises has added further uncertainty to Apple’s prospects in China.
India is expected to be a major driver in the long term, but iPhones currently account for less than 10% of smartphones sold in the country, due in part to high prices.
–With assistance from Philip J. Heijmans, Norman Harsono, and Eddie Spence.
(Updated potential Indonesian incentives in paragraph 12)
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